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Taxes and Subsidies

Questions 3&4

Screen Shot 2019-08-06</h1><p class='abPRemoveTitle'> at 1.25.26 PM.png


Screen Shot 2019-08-06 at 1.21.49 PM.png

Screen Shot 2019-08-06 at 1.21.49 PM.png

P
$9.00
$8.00
$7.00
$6.00
$5.00
$4.00
$3.00
$2.00
$1.00
D1
+ Q
1000 2000 3000 4000 5000 6000 7000 8000 9000
Space for notes and calculations. Questions begin on the next page.

Screen Shot 2019-08-06 at 1.25.26 PM.png

Question 3.
Use the graph on the first page to answer this question. If a $2 tax were imposed, how many cups of coffee
would be sold?
a) 0 cups
b) 500 cups
c) 1000 cups
d) 1500 cups
e) 2000 cups
f) 2500 cups
g) 3000 cups
h) 3500 cups
i) 4000 cups
i) 4500 cups
k) 5000 cups
1) 5500 cups
m) 6000 cups
n) 6500 cups
0) 7000 cups
P) 7500 cups
q) 8000 cups
r) 8500 cups
s) Impossible to know
t) None of the above
Question 4.
Use the graphs below to answer this question.
Price per
Price per
Supply
windmill
windmill
Supply
Demand
Demand
Quantity of
Quantity of
windmills
windmills
In which case will a subsidy increase the price paid to the sellers more?
a) Graph 1 (on the left)
b) Graph 2 (on the right)
c) Neither graph
d) Impossible to know

Top Answer

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Screen Shot 2019-08-06 at 1.21.49 PM.png

P
$9.00
$8.00
$7.00
$6.00
$5.00
$4.00
$3.00
$2.00
$1.00
D1
D1'
+ Q
1000 2000 3000 4000 5000 6000 7000 8000 9000
Space for notes and calculations. Questions begin on the next page.

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